Standing Committee A

[Mr. Win Griffiths in the Chair]

Railways Bill

Win Griffiths: I remind the Committee that the debate on the programme motion may continue for up to half an hour.

Tony McNulty: I beg to move,
That— (1) during proceedings on the Railways Bill the Standing Committee shall (in addition to its first meeting at 9.25 a.m. on Tuesday 14th December) meet— (a) at 2.30 p.m. on Tuesday 14th December; and (b) at 9.25 a.m. and 2.30 p.m. on Thursday 16th December, Tuesday 11th January, Thursday 13th January and Tuesday 18th January; (2) the proceedings shall be taken in the order shown in the first column of the following Table below and shall (so far as not previously concluded) be brought to a conclusion at the time specified in the second column of the Table. 
TABLE   Proceedings Time for conclusion of proceedings   Clause 1, Schedules 1 and 2, Clause 2, Schedule 3, Clauses 3 and 4, Schedule 4, Clause 5 11.25 a.m. on Thursday 16th December  Clauses 6 to 19, Schedule 5, Clauses 20 and 21, Schedule 6 5.30 p.m. on Tuesday 11th January  Clause 22, Schedule 7, Clauses 23 to 25, Schedule 8, Clauses 26 to 44 11.25 a.m. on Tuesday 18th January  Clauses 45, Schedule 9, Clauses 46 to 52, Schedule 10, Clause 53, Schedule 11, Clauses 54 to 58, Schedules 12 and 13, Clause 59, new Clauses, new Schedules and any remaining proceedings on the Bill 5.30 p.m. on Tuesday 18th January Clause 1, Schedules 1 and 2, Clause 2, Schedule 3, Clauses 3 and 4, Schedule 4, Clause 5 
I am sure, Mr. Griffiths, that it will be an enormous pleasure to work with you and Mr. Amess, your co-Chairman. We had the great delight of Mr. Amess chairing the Programming Sub-Committee last night. There was a good deal of good humour in what proved to be a lengthy meeting, but it was not without some dispute. 
The Sub-Committee's draft resolution sets out the number of sittings that the House has allowed us, and with an element of organisation and marshalling—and some logic—it includes a timetable. I know that the Bill will be dispatched with good humour. I promised on Second Reading that I would provide commentary, including a rough schedule of the regulations and guidance—they are to be found on the Table—and a range of other elements, because, like most legislation, the Bill needs to be seen in the wider context and because we are also doing a range of things in the non-legislative dimension. The latter are as important as the Bill, and I am sure that we will come to them subsequently. The motion is eminently logical and it has integrity. The timetable for the 10 sittings is set out in a way that should provide fun and entertainment, after which the Bill will be reported to the House and sent on its travels. I commend the motion to the Committee.

Greg Knight: I associate myself with at least some of the Minister's remarks. I certainly hope that the Committee remains good natured. We have a good chance of that with you in the Chair, Mr. Griffiths. Nevertheless, I notice that the Clock facing me is showing the same time now as it did when the Minister started speaking.
It will not have escaped the Committee's attention that the motion is in two parts. We all accept the need for the first part, as we need a framework so that we know the dates and times when we are to sit. However, the Opposition do not accept that the second part is either desirable or necessary. The danger is that what becomes commonplace will become acceptable. I therefore place on record our view that the timetable is not only unnecessary, but in many respects objectionable. 
I recall what happened when I was discharging duties similar to those of the hon. Member for Lincoln (Gillian Merron). During my time as a Government Whip, I was given responsibility for the Home Office. The Opposition spokesman for one Bill that I dealt with was the right hon. Member for Sedgefield, who is now the Prime Minister. In those days, we did not have restrictive motions such as this. Our discussions through the usual channels were such that the right hon. Gentleman was content if certain debates took place at a time of day that suited him. He was not interested in keeping the Committee sitting late or filibustering, or in frustrating the Government's will. I thought that he took a responsible view. 
In other words, if the provisions under discussion were debated in a manner and at a time that the Opposition found acceptable, the right hon. Gentleman was quite content to follow the process, and at the end of the day, the Government got their business through the House. Neither side ever had a problem with the legislation, because we both got what we wanted from the Committee process. Now, however, the Government have automatically put the Committee in a straitjacket. 
Under the old process, which was in operation when John Major was Prime Minister, the Government had a problem with the Committee stage and subsequently had to consider a programme motion on only a handful of occasions. When they decided to change the Standing Orders towards the end of their time in office, as part of what were widely known as the Jopling reforms, I was in the more elevated position of Government deputy Chief Whip. My instructions from the Prime Minister were that we were to do nothing that was unacceptable to the Opposition, who  were at that time, of course, the Labour party. So the only reforms that we carried through towards the end of that Parliament were those that were acceptable to the Labour Opposition. What is depressing about the present state of affairs is that the Government have introduced their changes without the consent of the official Opposition. 
I therefore invite my hon. Friends to vote against the programme motion. It is a sad day when the Government seek to put a Committee in a straitjacket, particularly when there has been no indication of any rebellion by Opposition Members, who merely want to scrutinise the Bill in a way that they deem fit, without being placed in such a straitjacket.

John Thurso: I, too, hope that our proceedings will be marked by the good humour that we have come to expect from the Minister and which I enjoyed during proceedings on another Bill.
Liberal Democrat Members are broadly content with the programme motion, and we shall vote in favour of it if a vote is called. This is an important Bill, and we broadly support its principles, but some points need to be scrutinised. In my experience, any scrutiny that does not happen in this place will merely happen in another place. That generally takes longer, so it would be helpful to ensure that we give the Bill proper scrutiny here. I hope that the Government will allow for a degree of flexibility to ensure that everything is covered. That aside, however, we are content with the motion. 
Finally, let me make a personal apology. I shall not be here on Thursday, because my daughter is getting married, and there is one authority higher even than Parliament, which I must obey.

David Wilshire: May I start with a point of order, Mr. Griffiths? I have been told off many times for taking my jacket off before the Chairman has given us permission to do so. Could you perhaps clarify the position?

Win Griffiths: The hon. Gentleman may take off his jacket.

David Wilshire: Thank you, Mr. Griffiths.
It is important to put it on record at the outset that the usual channels have, as always, been as kind as they can be. They have tried to encourage me to co-operate and to become an enthusiast for guillotine motions. The Minister has also set out to be helpful, but I am always suspicious of Ministers who do that, because they are usually disguising some awful truth that they hope we will not notice. Nevertheless, however hard the Government try to persuade me that programming is a good idea, I am afraid that they will fail. 
I have an example that makes my point better than would any lengthy speech about my concerns. [Interruption.] The Clock is still at 20 minutes past nine, so the half hour that we were given has not started. As far as I can see, we are always invited to ask not how much time a Bill needs, but how much we are prepared to give it. Flexibility is suggested, but it is not real. At the outset of discussions on this Bill, I was  asked how many sittings I thought it would need, and there was some good-humoured debate about the matter. The hon. Member for Caithness, Sutherland and Easter Ross (John Thurso) has more important duties, and I would be the last to criticise his priorities. What his constituents might make of knowing that he is shirking his duties here is for them to decide, but if I were in his position, I would make the same decision. However, yesterday I gathered that the other Liberal Democrat member of the Committee, the hon. Member for Southport (Dr. Pugh), also has difficulties on Thursday. I do not want to make personal criticisms, but the point was made to me—

John Pugh: I am on the School Transport Bill Committee; Parliament has double booked me.

David Wilshire: In my party at least, there is always discussion about who would like to serve on which Committee, but that is a different issue.
The situation that we discovered yesterday was, for reasons about which people can draw their own conclusions, that both members of the Liberal Democrat party will not be able to be here. I understand that they suggested—they have not approached me—that it would be a good idea if the Committee did not sit on Thursday afternoon. I have some sympathy with that idea, which I would be more than willing to discuss in principle. However, I was then told that, irrespective of what decision was taken about whether we would sit on Thursday afternoon, the end date is not negotiable. 
It was never going to be a discussion about how long the Bill would take to consider. We were told that the Bill will be dealt with by a particular date and that we can meet as often or rarely as we like, as that is a matter for flexible discussion, but that the length of consideration of the Bill is not open to debate. That says it all about the programme motion. The Government are saying, ''Meet when you like and at what times you like, but you must finish irrespective of how much substance there is in the Bill.'' 
As my party supports some parts of the Bill, it is possible that it might not need as much time as has been allocated. On the other hand, it might need more, but I am being told that there is no more time on offer, irrespective of what transpires. That is wrong, and it says everything that is bad about such an approach to legislation. It does not matter what the detail is, what the concerns are or whether we get it right, as long as we get the measure on to the statute book according to a timetable pre-ordained by a Government who are not prepared to listen and do not want to know whether they have got it right, as they just want to get on with it. On that basis, I object in principle to the motion. 
One cannot be a realistic politician unless one becomes pragmatic about some things. The Opposition are prepared to see whether we can make the best of a bad job. We are prepared to be as flexible as we can, provided that our attempt to be helpful in the circumstances is not taken as acquiescence in the principle to which we object. We will work within it,  while protesting about it, provided that we are never told during the proceedings that that means that we acquiesce. If we get to that stage, we will be back to the Clock needing to be repaired, and we might well run out of time. For the time being, however, we will do our best to make this Committee a success, and I promise that we will do our level best to make it a good-humoured, enjoyable experience.

Mark Field: I agree with the comments of my right hon. Friend the Member for East Yorkshire (Mr. Knight) and my hon. Friend the Member for Spelthorne (Mr. Wilshire). Some of us newer Members have not been used to the pre-guillotine sittings that were spoken of by the old timers—slightly old timers, perhaps I should say. It seems that the guillotine is here to stay and I suspect that, when the Conservatives are next in government, we will not change the system entirely. We need to move with speed, not just on the programme motion debate, but more generally, to ensure that all aspects are covered.
The Conservative Opposition have played as active a part as we can to ensure speedy progress. After all, it was only four or five parliamentary working days ago that it received its Second Reading, so we have moved as quickly as possible to the Committee stage. I appreciate the pressures felt by the Minister and the Government Whips, given that there could be an election as early as May or even sooner. With the parliamentary timetable in mind, there is some need to move as swiftly as possible. Equally, we will be discussing important issues—they are certainly important from the London perspective, particularly with regard to clauses 15 to 17—at the end of this week and in early January. I shall seek guidance on those issues from the Minister, who is also a London Member. 
We have some grave and understandable concerns about the programme motion being rushed through, particularly as 18 January is a fail-safe last date. I hope that we will have an opportunity to discuss everything in great detail and that we will be satisfied by the Government's replies. However, it is right at this juncture that we should put down a marker to express our concerns.

Tom Harris: I had not intended to make any comments at this stage, but the record should show someone from the Labour Back Benches saying—I believe that I speak for most of my hon. Friends in doing so—that the introduction of programme motions is welcome. Like the hon. Member for Cities of London and Westminster (Mr. Field), I was elected in 2001 and therefore did not have the opportunity to enjoy the all-night debates on the Bill that became the National Minimum Wage Act 1998, for example, although that is a missed opportunity that I do not regret.
The right hon. Member for East Yorkshire and the hon. Member for Spelthorne sent out conflicting messages. The right hon. Member for East Yorkshire  gave an undertaking that there would be no filibustering or undue extension of debates were the programme motion not to be carried. However, the hon. Member for Spelthorne, who has spoken consistently on this issue, then said that we needed longer debates and that we should extend the timetable indefinitely. Those positions cannot be reconciled. 
Back Benchers, especially on the Government side, benefit from programme motions because we can make contributions without the Whip giving us the evil eye and telling us to sit down so that we can get on to the next business. Because the programme motion exists, we know that we will not be holding up the Bill and delaying crucial votes. 
I finish by asking the right hon. Member for East Yorkshire and the hon. Member for Spelthorne whether they will give an undertaking to maintain their opposition to programme motions on every occasion if the Conservative party ever comes back into government. I suspect that such a position is wise in opposition but not very practical in government.

David Wilshire: Rather than invite us to make a commitment, perhaps the hon. Gentleman could make a commitment himself not to argue against programme motions when he finds himself in opposition next year.

Tom Harris: I can give a firm undertaking to oppose programme motions if I am in opposition after the general election in 2005.

Tony McNulty: There we have, in microcosm, the fun that the Committee will be as we rattle along.
We would all like to extend our heartiest congratulations to the hon. Member for Thurso on his daughter's wedding. We will miss him, but I am sure that he will be back, fighting fit, after the break.

Greg Knight: The dilemma of the hon. Member for Caithness, Sutherland and Easter Ross could surely be resolved by inviting the Committee to attend the wedding.

Tony McNulty: Even as a Minister, that is something beyond my gifts and powers. I apologise for referring to the hon. Member for Caithness, Sutherland and Easter Ross as the hon. Member for Thurso. I know that he owns most of his constituency, or that his family purports to do so—they are all going to the wedding—but still, I apologise.
I was on my feet for only two minutes, but I made the right hon. Member for East Yorkshire sad and depressed, which was a good start, and turned the hon. Member for Spelthorne, who is usually a hearty chap, into a complete cynic. We heard a degree of honesty, which we have come to expect, from the hon. Member for Cities of London and Westminster, who said somewhere in his short contribution, unless I misheard him, that the Conservatives probably would not make many changes if they were to get into government. 
The only point on which I disagree with the hon. Member for Spelthorne is about flexibility—the system is flexible. We have on our side, in the usual  channels, someone whose middle name is flexibility. I am sure that the Programming Sub-Committee could meet again before 18 January to re-evaluate the position as we go forward with our deliberations. That may not be a terribly popular idea, but it could meet just after this sitting, and we could reinstate the sitting of 21 December if people are that desperate for more time. I am sure that that would go down extremely well with our Assembly colleagues. It might be a smaller Committee, but the option is there, none the less. 
Hon. Members will see from the programme motion that we shall meet at 2.30 pm on Tuesdays and Thursdays, but that there is no end time. If we are having fun, we can go on for as long as we choose, so there is flexibility, and that is an appropriate way to do business. 
I will happily make the same promise as my hon. Friend the Member for Glasgow, Cathcart (Mr. Harris), because if there were ever a Conservative Government, they would not change this, and because the chances of that are so remote that we in this House shall carry on as we do. This is an appropriate way to marshal our business; the motion is fair, and I commend it to the House. I hope that we can dispatch the motion and get on with the fun. 
Question put:—
The Committee divided: Ayes 14, Noes 4.

Question accordingly agreed to.

Win Griffiths: I remind the Committee that there is a money resolution and a Ways and Means resolution in connection with the Bill, copies of which are in the Room. I also remind Members that adequate notice of amendments should be given, and that as a general rule my co-Chairman and I will not accept starred amendments. I ask Members to ensure that their mobile phones and pagers are either turned off or in silent mode while they are in Committee.

Clause 1 - Transfer etc. of SRA functions and abolition

David Wilshire: I beg to move amendment No. 14, in clause 1, page 1, line 8, leave out 'may' and insert 'must'.

Win Griffiths: With this it will be convenient to discuss the following amendments: No. 15, in page 1, line 14, leave out paragraphs (a) to (c).
No. 17, in page 2, line 7, at end insert ', and franchisees and passengers'.

David Wilshire: The challenge facing me, Mr. Griffiths, is whether you will let me develop some points to the extent that this becomes a stand part debate, or whether we should keep the debate tight, although I suspect that that will become clear. These amendments go to the heart of the Bill, so we may need to take a bit of time on them. We do not seek deliberately to hold up the Bill, and have given an indication of our good faith by not using all the time available to discuss the programme motion. Should this group of amendments take a while to debate, it is because they are of some significance, or at least amendment No. 15 is.
I shall deal first with amendments Nos. 14 and 17, as they do not need to be discussed at great length. Some cynics could look at amendment No. 14 and say, ''Here we go: changing ''may'' to ''must'' is a well-tried tactic for discussing something that is not really of any great importance.'' However, on this occasion I genuinely think that it is of importance, because clause 1(2) states: 
 ''The Secretary of State may make a scheme for the transfer of property, rights and liabilities from— 
the Strategic Rail Authority'' 
and so on. 
My understanding of the Bill is that one of its key purposes is to abolish the Strategic Rail Authority; I understand not that we may decide to do it, but that getting rid of the wretched thing is a key purpose. Therefore, to say that as a result of the Bill the Secretary of State ''may make a scheme'' misses the point. An important issue arises: if we grant the Government the powers in question, the abolition and the transfer of powers must happen. I therefore suggest to the Government that they make things clearer and simpler. For the avoidance of all doubt about the purpose of the measure, changing ''may'' to ''must'' is more than a tactical debating point; it would clarify the Bill no end. 
Amendment No. 17 relates to subsection (5), which sets out whom the Secretary of State must consult when he comes up with a scheme. It defines the category as 
''every person to whom property, rights or liabilities would be transferred under the proposed scheme.'' 
Amendment No. 17 would add two other groups of people who should be consulted: the franchisees who run the railways and the passengers who use them. It could be argued, and I suspect that the Minister will try to persuade the Committee of this, that the provision is all about property, rights and liabilities, and therefore has nothing to do with passengers. However, one of the problems about the Government's approach to trying to run the railways is that passengers' interests have been pushed down the list, and political objectives have become more and more important.
If at any stage in our consideration of the Bill we come across instances of the people who run the railways and the passengers not being included—even if it might not seem logical to include them at the outset—we are stacking up trouble, because the people who matter will yet again be left out of the loop when it comes to sorting out the future of the railways. Amendment No. 17 is intended as a correction to that. I do not see any great need to explain in detail why franchisees should be involved, although if the Minister wants me to I shall happily return to the matter—as I will for passengers. It is fairly self-evident for the purposes of a discussion of this sort that they could and should have a contribution to make at all stages. 
I must accept, in talking about amendment No. 15, that I could have tabled all sorts of variations of amendments to subsection (3); but for the purposes of the debate I simply opted for suggesting the deletion of paragraphs (a), (b) and (c) from the list of persons to whom the Secretary of State might transfer the relevant property, rights and liabilities. So, under my amendment, the people to whom such responsibilities should not be given are the Secretary of State, the Scottish Ministers and the National Assembly for Wales. 
I am fairly certain that the Minister will tell me that that strikes at the heart of what the Government are trying to do. I hope that it does, because it is intended to do so. Whereas my party agrees with the abolition of the SRA—I am sure that my right hon. Friend the Member for East Yorkshire will give a far better explanation of this than I—we do not agree with passing its responsibilities, duties and powers upwards, ever further from the franchisees and the passengers, and ever closer to politicians and civil servants, who are admirable people but useless at running businesses. 
One need only look back over the years to see how problems arise when politicians try to behave like business people. Civil servants are good at many things, but if they were good at managing business, that is what they would be doing. I do not mean to criticise Ministers or civil servants when I say that they are, in my general experience, quite useless at running things like railways. Indeed, we are delighted to see the end of the SRA, for reasons that I shall explain in a moment. However, we are not happy about the fact that the SRA's responsibilities and duties are going upwards. They will now be more remote and will be in the hands of people who will not be good at doing what they will be asked to do. 
On the other hand, there is the benefit that we will be getting rid of the SRA. Over the four years that it has been around, the SRA has demonstrated itself to be an utter waste of time and money. When it took over, the Office of Passenger Rail Franchising cost £13 million and employed 187 people. The organisation that we are being asked to abolish costs £102 million and employs 454 people. The cost of the thing and the  number of people it uses have grown and grown as it has become less and less effective, so we are of course delighted to see it go. 
I am also delighted to see the SRA go because it has not improved services. It has failed to give the railways any leadership or direction. In fact, the reason that the Government have given for getting rid of it is that there should be more strategic leadership in somebody else's hands. Of course, that is a bit rich from the very Government who set up this wretched body in the first place. Four years ago, colleagues of ours sat in a Committee Room, having to listen to the Government saying that the SRA was the best thing since sliced bread and that it was the future of the railways. Here we are four years later, however, in another Committee Room, with a different group of colleagues, being told how useless it is and that we should get rid of it. Rather than criticising me, as I am sure he will, the Minister should apologise for wasting time, using people unnecessarily, messing around with the railways and getting things wrong. 
Amendment No. 15 would make it clear that power should not be transferred upwards and that we want it transferred downwards. It is the railway operators themselves who deal with passengers and freight; they should be given the power to get on with the job of running the railways, not have power taken even further away from them. 
One of the difficulties for the railways is that the franchisees' lack the confidence to invest, because they are always being messed about. Well, they will be messed about even more now, and much-needed investment, which would improve the railways, will be even more difficult to obtain if power is passed upwards. Amendment No. 15 would, I hope, move power in the other direction. 
Those, then, are the reasons why these three amendments stand in my name. I seek your guidance on one further issue, however, Mr. Griffiths. Subsection (3)(f) refers to a company, and I would be perfectly happy speak to it now. Equally, if you would prefer, I could leave it to the stand part debate.

Win Griffiths: Given the fairly general principles that have been set out in dealing with paragraphs (a) to (c), I would be content to allow a few words to be said about paragraph (f). We could then avoid a stand part debate.

David Wilshire: I am grateful to you, Mr. Griffiths. I hoped that you would say that, because paragraph (f), in conjunction with amendment No. 15, raises a substantial issue, which is worthy of debate. It refers to
''a company which is wholly owned by a person falling within any of paragraphs (a) to (d) or is jointly owned by more than one of them.'' 
That simply means that it will be impossible to involve any company that is not owned by the Government, other politicians or some combination of the two. The question that arises from subsection (3), however, is what on earth is wrong with transferring powers to a company owned by shareholders? Yes, it is the whole issue of nationalisation versus privatisation.
Just as the Minister will not apologise for making a mess of the railways, I will not apologise for wanting to privatise those businesses currently being run by politicians, because we are not very good at it. Instead, clause 1(3)(f) imposes a restriction on the use of outside companies. It that provision stands, it will be impossible to go to the private sector in order to use the expertise of businesses to run things properly. That was the general point, Mr. Griffiths; I shall not elaborate because of your suggestion that I speak to the amendment only briefly. 
That is the thinking behind the amendments. I look forward to hearing the contributions of other hon. Members.

John Thurso: Let me preface me remarks by saying that any member of the Committee who wishes to come to the wedding is welcome, provided that they travel there and back by rail—which means, I suspect, that I shall not see many of them there.
I was interested to see what would be the exact thrust of this little group of amendments. Amendments Nos. 14 and 17 raise the perennial question of whether ''may'' should be ''must''. The hon. Member for Spelthorne could have chosen the verb ''will''; it would have served the same purpose. However, there must be a reason, and I look forward to hearing what the Minister has to say. 
Amendment No. 17 would insert into subsection (5) the words ''and franchisees and passengers''. As a general principle, I am happy to see anyone consulted. Indeed, when it comes to consultation, the more the merrier. However, whether that consultation has a particular purpose is a moot point. 
The main thrust comes with amendment No. 15, which would leave out paragraphs (a), (b) and (c) of subsection (3). As the hon. Gentleman explained, his party would like to see the running of the railways taken away from politicians and given to business. I fundamentally disagree with that premise. The problem with the railways is that the long-term strategic thinking required for running a successful railway has not been delivered because, for as long as the railways require a subsidy, it is a task for Government. If subsidies are required, it will always be for the Treasury and Ministers to make those decisions. 
I think that the hon. Gentleman slightly misunderstands what the SRA's property rights and liabilities might be, because it does not own great chunks of the railways. I suspect that it does not own much. Indeed, I submit that the majority is owned through Network Rail. I suspect that the clause deals with the residual rights and liabilities. I imagine that, with the abolition of the SRA, its staff will go somewhere else, and those staff will have pension rights, resulting in more obligations and liabilities. There will also be contracts with suppliers to be fulfilled, and the office buildings that it owns or leases will all have to be dealt with.
If one accepts that strategic direction will come in the main from the Department for Transport and from the devolved bodies, it seems perfectly appropriate that those staff should go to whomever is to receive such direction. If we start with the premise that the SRA should go, the Government will have to take primary responsibility for strategy, although operational delivery will come from Network Rail. In that case, those liabilities assets and rights will clearly have to be transferred somewhere else. The very people and bodies to whom they are to be transferred are likely to be the Secretary of State, Scottish Ministers and the National Assembly for Wales. I am afraid that the hon. Gentleman did not carry me on that argument. 
With regard to the hon. Gentleman's general point, I assume that subsections (2)(b) and (3)(f) are required to cover the fact that some of the bodies mentioned may own companies. I doubt whether those provisions are meant to exclude the private sector, inasmuch as I believe—perhaps the Minister will say whether I am right—that the clause concerns the transfer of the SRA's property rights and liabilities, rather than the ownership of the railways. 
Having been both a business man and a politician, I concur with the hon. Member for Spelthorne. Businesses should be run by business men, but equally, where political direction is required it is right that it should be given. So long we have a subsidised railway it will be for this Government or any future Government to give that direction.

Greg Knight: Unless my eyesight is failing, it has become apparent why the hon. Member for Glasgow, Cathcart was in favour of the programme motion. He voted for it and then disappeared. En passant, in response to his point, I never said that we would oppose programme motions on every occasion. When my party takes power after the next election I will campaign for a change in these procedures because they are bad and do not lead to appropriate scrutiny.
I do not want to make heavy weather of the amendments, but shall make a few points. Having served on a Committee with the Minister before, I know that one of his favourite words is ''otiose''. I suspect that when he catches your eye, Mr. Griffiths, he will say that amendment No. 14 is otiose. 
Amendment No. 15 is not perfect, but I get the drift of what my hon. Friend the Member for Spelthorne wants to achieve and I agree with the thrust of his arguments. We do not support taking the strategic operation of the railways back under Government control, although I have sympathy with the Government's reasons for abolishing the SRA, as I said on Second Reading. We therefore do not oppose the thrust of what the Government want to do in part 1. 
My hon. Friend hit on something, however, when he said that the answer was not necessarily to give powers to the Secretary of State, Scottish Ministers and the National Assembly for Wales. However, if amendment No. 15 were agreed to, further attention  would be needed to deal with the gaping hole that doing so would leave. For instance, it would make subsection (3)(f) nonsensical. 
I agree with my hon. Friend's comments and those of the hon. Member for Caithness, Sutherland and Easter Ross about amendment No. 17. If one supports the principle of consultation, the wider the consultation, the better for all concerned.

Christopher Chope: It is a pleasure to serve under your chairmanship, Mr. Griffiths.
On amendment No. 15, will the Minister say what the implications will be for Scotland, because my understanding is that there is a conflict between local interests in Scotland and the national strategic interest, particularly in relation to the future of Waverley station and who will pay for its redevelopment? 
Under clause 1, as I understand it, responsibility for ScotRail, which runs local services in Scotland, will be transferred to Scottish Ministers, but there will be no transfer to Scottish Ministers of responsibility for, say, the through east coast main line taking passengers from London to Edinburgh and further north. There has in the past been a conflict of interest between the needs of the long-distance franchise holders and ScotRail, the local organisation. Will the Minister explain exactly how this will work in practice, as I wonder whether we are in danger of creating two different areas of responsibility, and thus conflict, rather than having one unified control? I would be greatly obliged if he could illustrate his answer with specific reference to Waverley station and the much-needed reinvestment in it.

Tony McNulty: As someone said, we need to be very clear that the clause is not about who owns or runs the railways or any other such element of public policy, but about the subsequent transfer of the SRA's assets and liabilities on abolition. Hon. Members will look in vain for the detail of the transfer scheme and all the other elements in the clauses because they are not appropriate in the clauses. The best part of a 14-page schedule, schedule 1, goes into some detail about the transfer of functions, which are not all simply transferred back to the Department, but are equally, as hon. Members have said, transferred to Scottish Ministers, to the National Assembly for Wales and to the Office of Rail Regulation. Some functions disappear.
The substance of what the hon. Member for Caithness, Sutherland and Easter Ross said is entirely right: beyond the people who work at the SRA, their pension liabilities and other such liabilities, some of the contracts into which they have already entered, and a range of other elements that are germane to its existence, the SRA is not about to transfer a huge bank of assets. With the best will in the world, therefore, the overall thrust of the amendments is inappropriate. Let me deal with them in turn.
The hon. Member for Spelthorne will be pleased to know that amendment No. 14 is not otiose. I shall probably repeat the word otiose in due course. If he has studied previous Committee proceedings, he will know that there is no doubt that I will also return to phrases such as ''undue specificity'' as we deliberate. In this instance, however, his amendment is not otiose. It is irrelevant, redundant and entirely superfluous, but it is not otiose. Whether or not we want to arm wrestle about whether it should say ''may'' or ''must'' is entirely a matter of style for the Committee, but we will resist the amendment, none the less. 
Given that clause 1 invokes the abolition of the SRA and schedule 1 explains in 14 pages where all its functions will go, the notion that the amendment is necessary, because the Secretary of State might say, ''Well, that is all very well, but I do not fancy abolishing the SRA this week or making a transfer scheme, so I am not going to bother,'' and so, just to be sure that we cover ourselves, the clause must say ''must'' rather than ''may'', is entirely irrelevant and superfluous. We will therefore not press the Committee to vote on the amendment. Hopefully, we will leave it to one side and resist it if it is pressed to a vote. 
The same is true of amendment No. 17. Should we consult franchisees and passengers if we are talking simply about creating a transfer scheme in lieu of abolishing the SRA and transferring its assets and liabilities elsewhere? I agree with the sentiment that we should do more to consult franchisees and passengers on matters relevant to running the railways. That is why, as we will see, the Bill transforms the rail passengers committees—the passengers' voice—and why we do more and more, in the Bill but more readily outside it, to engage franchisees. 
Are we seriously saying that every single passenger who used the railway system last year—the number of passengers reached a billion for the first time since 1961—should, at least potentially, be consulted about Joe Bloggs of the SRA and where his pension liabilities and assets should go when he leaves the SRA? Of course not. 
Clause 1(5) clearly states: 
 ''Before making a scheme under subsection (2)''— 
the transfer scheme to which the hon. Gentleman refers— 
''the Secretary of State must consult every person to whom property, rights or liabilities would be transferred under the proposed scheme.'' 
There is a huge reservoir of work going on, and processes and procedures to unfold, which will affect every individual in the SRA in terms of their subsequent role or otherwise in the DFT unit, or in other elements. We should bear in mind that the ORR, Network Rail and, to a small extent, the RPC, will take on some of the SRA's functions. It is not a huge land-grab back into government. In the context of what the clause is about—the transfer of SRA functions and abolition—if I were to be unkind, I should say that  amendment No. 17 is a tad otiose. It is misguided and totally irrelevant to the clause, but I shall throw in ''otiose'' to satisfy the hon. Member for Spelthorne. 
That leaves us with amendment No. 15, which the hon. Gentleman rightly said was the most important of the three. As his right hon. Friend the Member for East Yorkshire gently suggested—teasing him, I thought—if the amendment is accepted, we had better hurry to replace it, otherwise the entire asset base, liabilities and functions rested with the SRA will go either to the Office of Rail Regulation, the independent economic regulator of the railways, which seems rather strange, although we could, perhaps, sort out the mess if we were foolish enough to pass them to that body, or the Rail Passengers Council. 
It is entirely honest of the hon. Gentleman to say that he is trying to wreck the Bill, which is entirely in order, but let us be clear what he is about: there is nothing with which to replace it, so we are back where we were on Second Reading, with the Conservatives saying, ''We know that we do not like the SRA, and we don't have a clue what to replace it with, but we don't like that.'' That is a bit of an irresponsible, yet vaguely defendable, position on something as important as the national railway system. 
The Conservatives do not like the fact that this is the most significant element of devolution since the Scotland Act 1998, in terms of what goes to Scottish Ministers, which is rather strange, because I am sure that I heard someone suggest that it might be appropriate to get closer to those who most directly impact on decisions. We would say that that is right for a strategic framework. So the Conservative position is this: nothing for Scotland, nothing for Wales, and nothing for England or the UK. They are against coming up and against going down; they are not sure what they want, but they know what they do not like. That may be a defensible position, but, hopefully, the robustness of their arguments will improve rather than otherwise as the Committee goes on, because we cannot have the functions, assets and liabilities of the SRA being inherited by the Rail Passengers Council, which would not want that, or the Office of Rail Regulation, for different reasons. 
If the hon. Gentleman is serious about there being a significant rail passenger voice, why encumber the new Rail Passengers Council with all the assets, liabilities and functions of the SRA? It would not get out of the trap in terms of properly representing passengers. I do not understand the objection to the strategic dimension of the SRA coming back to government, because we need it. I reiterate that, given where we started, post-1997, and where we are now, the SRA has carried out a huge body of work across the piece—much of it unsung—in freight, franchises and early work on route utilisation strategies, which has got us to the position at which we can get the rail network into some sort of shape. That is all in the context of the 1 billion-plus passengers who use it. So, although the SRA's day is done—that is the effect of the clause—I should not traduce it and insult it quite as the Opposition do. It has carried out much very good work and encompasses a body of expertise that we  shall try to capture for the new Department for Transport rail unit, which is not in the Bill but is mentioned in the papers that I tabled earlier. To characterise that expertise as a bunch of bureaucrats or a bunch of civil servants who cannot run anything is, as I said on Second Reading, not terribly helpful. 
Once we have dealt with abolition and the transfer of SRA functions, we shall come on to the substance of issues suggested by the hon. Member for Christchurch (Mr. Chope). I shall be happy to return to them at that point. However, it was interesting that he said he did not want two different areas of responsibility and no overall control. That is code, I suggest, for not wanting any further devolution to Scotland. That is an entirely fair position, but we disagree with it. 
The hon. Gentleman wants ultimate uber-centralisation. He wants command and control in an almost Stalinist way, which is interesting. That, he says, is the only way to make things work; it is not possible for all the internal network run by ScotRail to be managed in the context of the inter-city lines that go in and out of Scotland. That is nonsense. Of course it is possible. That is what we need to work towards. It cannot happen if we say that the Office of Rail Regulation and the Rail Passengers Council need to run all the SRA's functions and take over all its assets and liabilities, which is the main thrust of the amendment.

Christopher Chope: I hoped that the Minister would deal with the substance of what I said, rather than put words into my mouth or my hon. Friends' mouths. Why is not it possible for us to discuss, as a specific example of the implications of clause 1, what will happen about the demand in some quarters for the redevelopment of Waverley station? Who will pay—ScotRail, Scottish Ministers or the UK Government?

Tony McNulty: Of course I put words in the hon. Gentleman's mouth, and I do not apologise for that. I shall probably do so throughout the Committee's sittings. I did say, in my next breath, that the hon. Gentleman's point was interesting, but not appropriate on the clause that we are considering, and that I was more than happy to return to it when it became appropriate. However, it will not be appropriate at all if the amendment is passed. If that happens, the interface between Scottish Ministers and their responsibilities for rail and the Secretary of State and the wider rail interests of the UK will not form the basis of any discussion, because of the top-down centralisation that has been implied.
I am more than happy to discuss—I could spend hours discussing—Waverley station. I would discuss who owns it, who runs it and who will modernise it or otherwise. That means, of course, starting from a premise that for 18 years the Tories did nothing much with it. That is one reason why we are in the hole that we are in. However, we can return to the matter, and I look forward to doing so in due course.

Christopher Chope: Will the Minister give way?

Tony McNulty: No, I shall not, because the hon. Gentleman will only go on about the same thing. He should save it for later or he will spoil my enjoyment; I have something to look forward to on the rest of the Bill.
Amendment No. 14 is not otiose but utterly irrelevant and redundant, so we do not want it. Amendment No. 15 would put a huge hole at the heart of the overall strategy and public policy laid out in the Bill, so we would rather not pursue it, especially on clause 1. Amendment No. 17 is at best misguided in the context of consultation because it relates to the very limited focus of the transfer of the SRA's functions, liabilities and assets. Anyone affected by the transfer of those assets and liabilities will be consulted, as the clause states.

Greg Knight: I think that my hon. Friend the Member for Christchurch was just concerned that the Minister should not fob him off about Waverley station. I expect that my hon. Friend would be satisfied if the Minister could tell us at what point in the Bill's consideration he thinks it will be appropriate to discuss the issue.

Tony McNulty: The one thing I never do is fob people off, as the hon. Gentleman will know. [Interruption.] If I do, I hope that I do it with a degree of politeness, although it strains me sometimes, but there we are. I suspect that we can return to the issue when we start discussing the early stages of part 2 and the substance of the various assistance and transfer schemes for Scotland and Wales. Indeed, I suspect that we will return to it when we discuss several other issues, which, on paper, do not appear to be directly related to Scotland, but which relate to the substance of the Bill's transfer and devolution elements. Some of those elements are specific to Scotland, but others, such as those in part 2, are more general, and refer, where appropriate, to the Secretary of State, Scottish Ministers or the National Assembly for Wales.
I assure the hon. Member for Christchurch that I am not fobbing him off, and we shall return to the issue at the appropriate stage. It is a tad ironic that he wants to discuss the interface between the Scottish and the UK dimensions, when one of his hon. Friends has introduced a Bill that would totally destroy that devolution. However, I am not fobbing the hon. Gentleman off. He is a strong, forceful character, and if he feels that he has been fobbed off, I am sure that he will return to the theme with a vengeance. For the reasons that I have given, however, none of the amendments commends itself, and I urge my colleagues and all right-thinking members of the Committee to resist them.

David Wilshire: Well, that was fun. I am glad that the Minister and I have taken up where we left off the last time we were in Committee together. Perhaps I should get in an apology now, because I may well burst into applause in a couple of sittings' time. By then, the Minister will have used up all the insults that he has used before, which will be some sort of achievement. I have been keeping a mental list of them. Thus far, he has said that I am not right thinking, so that is that one  ticked off. I am also irrelevant, so that is another one ticked off. Furthermore, I am misguided. They get worse as the days go by, but I have heard them all before. One of my kind and gentle colleagues was even called a Stalinist, which is going some for our first morning. It is typical of the Minister to bluster away and hope that nobody notices the sense of the points that I am making, but I have got used to that.
Let us consider what was behind the Minister's comments. I have learned that he always makes set-piece abusive remarks, which owe nothing to the arguments before us. He works off a bit of steam on the subject and then sits down if he has enjoyed himself. He also likes to put words into my mouth, but I do not think that I have made any reference to devolution, for example. For him to say that amendment No. 15 indicates any view that I may or may not have about devolution in Scotland and Wales, is so ridiculous that it is funny. I do not think that Hansard will show that I have made any reference whatever to devolution. None the less, the Minister decided that he wanted to get that one in in the hope that it would do him some good. Well, I am afraid that it will do him no good at all on this occasion, because I will not rise to the bait on the issue. Indeed, you would not let me, Mr. Griffiths. However, if the Minister would like to talk to me about it afterwards, I would be happy to do so. 
Let us look at some of the silly thing that the Minister has said. I am sure that he has a mental list of the things that I say, but he has said that amendment No. 14 is utterly irrelevant. His comments on the substance, however, suggest that it is not. He argued that it was ridiculous to say that the Secretary of State would not shut down the SRA once he had done everything that he was required to do in the Bill. However, if it is ridiculous to say that he will not shut it down after he has transferred all its power, why on earth does the Bill not say so? Instead of saying that he may transfer the powers afterwards, will the Minister admit that the Secretary of State has to transfer them? Surely to goodness, it would be sensible to say so. It is not the amendment, but giving the Secretary of State some choice that is the irrelevant bit. If the Minister feels strongly about it, I do not wish to go to the stake for it. 
So far as consulting is concerned, it was fascinating to hear the Minister saying that he would pick and choose whom to consult; that people who use the railway might have a say in some things and not in others. That is what is wrong with this Government's approach to passenger service. What does it matter if he has a great many people whom he ought to consult? Lots of people use the railways and lots of people have an opinion. I am all in favour of asking them. Similarly, I do not necessarily want to go to the stake on that one either. 
[Mr. David Amess in the Chair]10.30 amÌOn amendment No.15 and the question whether deleting paragraphs (a), (b) and (c) of subsection (3) would knock a hole in the Bill, I readily concede that it is a probing amendment to find out whether power  would go upwards or downwards. At no stage have we said that we could do without the provisions. I sought to indicate as best I could without straying beyond the terms of the subject under discussion that the power should go down and not up. I shall not elaborate, and neither will I apologise for suggesting that that power should not go upwards to politicians. 
The Minister does not like some of the suggestions. Indeed, the hon. Member for Caithness, Sutherland and Easter Ross, who represents half of Scotland—[Interruption.] I will get the map out over lunch and check the exact proportion of the geographical area; it is vast. The hon. Gentleman seems to have a notion that if there is a subsidy, it gives politicians a right to run the thing. I am sure that when he went to buy a wedding present, he did not say, ''If I buy this I am determined to dictate to the manufacturer all sorts of things about how, where and when it should be made and what it should look like.'' I see no difference between buying something and providing a subsidy. If we provide a subsidy, we are entitled to discuss the handing over of the money, but that does not give us a right to run the business. That is the difference.

George Howarth: Is the hon. Gentleman seriously proposing that a public subsidy to a service should be unconditional?

David Wilshire: No, I am not suggesting that one little bit. I see no difficulty in saying what the subsidy is for. Organising the strategy of the business once the subsidy has been obtained and the requirements of the person providing it, however, are best left to the business, not to the politicians who attach so many strings—way beyond what the subsidy justifies—to the running of the business. That is the distinction that I am making. I know that I will not persuade the hon. Gentleman or the hon. Member who represents half of Scotland, but that is where I am coming from.
This has been an interesting debate and it would not be sensible to divide the Committee. I have made my points, and we have heard some responses. We have had offers from the Minister to return to the substance of some of the issues, for which I am grateful. In those circumstances, I beg to ask leave to withdraw the amendment. 
Amendment, by leave, withdrawn.

David Wilshire: I beg to move amendment No. 18, in clause 1, page 2, line 14, after 'Authority', insert
', provided proper compensation is paid'. 
I am sure that there is a simple answer in this case. I want to indicate to the Committee that I am not a total right-wing philistine in moving the amendment, which says that if one is going to remove somebody from their job, one should pay the proper compensation. I should have thought that that was a principle that commended itself to the Minister. I do not need to elaborate, except to say that I seek to protect the interests of somebody who is chucked out of their job.

Tony McNulty: Welcome to the Committee, Mr. Amess. I am sure that we will have as much fun today as we did in yesterday's Programming Sub-Committee. I look forward to working under your chairmanship.
Paragraph 3(3) of schedule 14 of the Transport Act 2000 states: 
 ''If, when a person ceases to hold office as a member of the Authority, the Secretary of State determines that there are special circumstances which make it right that the person should receive compensation, the Authority shall pay such compensation as may be determined by the Secretary of State.'' 
If we abolish the SRA and transfer its functions, as we intend to do, we cannot leave that element on the statute book, because the SRA would then be authorised to compensate the members of its board whose positions were terminated in special circumstances. We are halfway there with what is already in legislation, with the notion of compensation—the hon. Member for Spelthorne is entirely right and the point is worth making—yet we cannot say that compensation should be paid in special circumstances, which the abolition would be, but that the SRA should pay it, because we are abolishing that as well. The proposals therefore draw in to the Secretary of State the power contained in schedule 14 of the 2000 Act. I give my assurance that we will interpret the demise of the SRA as a special circumstance, as outlined in the 2000 Act. 
It is equally important that we should be allowed from time to time to decrease the SRA's board membership, as subsection (7) also says, because the board number is fixed in statute too. However, we will not take a big bang approach. There will not be a day between now and whatever date is fixed in the future on which someone flicks a switch and the SRA no longer exists and its assets, liabilities and so on are transferred. By definition, the process will taken place over time. We want the numbers on the board to reflect the SRA's residual functions as that process takes place. However, I take the point about compensation, which we feel is substantially covered in our proposals.

Greg Knight: I welcome what the Minister has said thus far. Can he confirm that he is saying that, where someone is under contract and that contract has certain provisions relating to its termination, those contractual terms will be honoured?

Tony McNulty: Within the context of the amendment, of course I am. In the broader sense, there will be other cases involving the transfer of the SRA's liabilities and assets where contract law will prevail. The amendment refers to subsection (7)(a) and concerns membership of the SRA board. We want to roll forward what prevails in the 2000 Act, because the point that the hon. Member for Spelthorne made is entirely fair.
The issue also concerns numbers. Under the 2000 Act, we are obliged to ensure that the SRA board consists of at least eight members and no more than 15. It is possible to amend that by order, and the current membership is 11. However, once the transfer of  functions, assets and liabilities is in train, the role of the board will become moot. We therefore want the board to diminish as part of the process. 
The compensation elements that the hon. Member for Spelthorne mentioned are covered in schedule 14 of the 2000 Act and I am happy to give a commitment that ''special circumstances'', as outlined in those provisions, would include, I assume, the demise of the SRA.

Christopher Chope: What is the Minister's estimate of the likely total bill for compensation?

Tony McNulty: Given that the current membership is 11 and that at some stage we would like to get it down to zero, I suspect that the answer will depend on the speed at which we move from 11 to zero. If we did that tomorrow, the answer would be 11 times whatever is the proper compensation for those 11 individual members of the board. If it is done over time, the compensation package will be either more or less, although I have not thoroughly investigated the root and branch details; it will be whatever the optimum compensation package is under paragraph 2(3) of schedule 14 to the Transport Act 2000 times 11. What we are not going to do is increase the membership of the SRA to 15 at a time when we seek the diminution of its role and its ultimate demise. That may sound like Sir Humphrey, but that is the best answer that I can come up with. It is 11 times whatever is the current package.

Greg Knight: I do not criticize the Minister for not having the figures at his fingertips, because they obviously involve complex calculations. Is he prepared to give the Committee an outline of the figures, either in a future sitting or by letter, bearing in mind that he must know at some point how quickly he wants to proceed with abolition?

Tony McNulty: That is a fair point. To the extent that I am committed to ensuring that the Committee and the House are given as much detail as possible about the non-legislative dimensions of the policy as well as the legislative ones, that seems perfectly in order. The only caveat is that specific, individual circumstances to do with length of time served and a range of other elements may affect the compensation package. If I can at least get ball park figures for what the compensation element might be, however, and at what stage the 11 will go down to a residual board as a prelude to its ultimate demise, I will happily share them with the Committee. In that context, I ask that the amendment be withdrawn.

Mark Field: The amendment is interesting. I am keen for the Minister's confirmation that any compensation arrangements will be made public. The rail industry has clearly been subject to controversy, not least with the renationalisation of Railtrack some three years ago. As a result, it seems that books are likely to be written and stories told not only by members of the SRA but, more interestingly, by former rail regulators, that could be of commercial value. As a result, I  suspect that some sort of confidentiality arrangement is likely to be part and parcel of any compensation arrangements.
It is certainly my understanding that the erstwhile rail regulator, Tom Winsor, was put under some pressure to resign at one point, and substantial compensation packages were bandied around in what might be called a quasi-offer, if not a fully fledged offer, that were well in excess of what might be considered normal. I understand that that gentleman is likely to write a book about his experiences as rail regulator both before and after the October 2001 decision to renationalise Railtrack and about the expensive mess that our rail industry got itself into over the past few years. 
We are likely to see somewhat less dispute in relation to the Strategic Rail Authority. One hopes that when it is wound down from 11 members to zero, its members will be less likely to wish to sell their stories. Given the concern that has been expressed, however, it is important that the compensation arrangements are made entirely public and that we know on what basis they are made. 
The Minister made it clear that he would try to give us some indication of the general arrangements, perhaps in writing. On the basis that one or two members of the SRA are likely to have been more deeply concerned with rail strategy over the past six or seven years, however, he will understand that the Opposition are concerned that if confidential compensation is put in place that takes account of the controversy that might emerge about the running of the railways over the past few years, that fact should be in the public domain. 
On that basis, I hope that the Minister will at least give us some comfort; what we are discussing is an important factor, and in the context of abolishing a public body that has been controversial, it should not be ignored.

David Wilshire: Well, well; an amendment of mine has not had abuse dumped on it by the Minister. I must be on to something. We have heard his assurances, and this is a serious subject. Whatever we feel or think about an organisation, the people in it will have been doing the job to the best of their ability, and if a Government decide to wind it up, it is proper to observe all the normal courtesies and rules about compensating people who may have made assumptions about the length of their tenure. I have listened carefully to him and I am sure that the record will be sufficient ammunition, should something go wrong in future, in establishing clearly the Government's intention.

Tony McNulty: I intervene on the hon. Gentleman purely to answer the question asked by his hon. Friend the Member for Cities of London and Westminster, rather than speaking again once he concludes. In the context of freedom of information and the caveats that I mentioned earlier about personal circumstances and personal conditions, I should say that if I can make public the compensation packages and announce  when they are likely to be made available—perhaps there will be paperback rights to my lurid inside story of the SRA—I shall of course do so. I shall take advice and pursue the matter.

David Wilshire: I am sure that my hon. Friend the Member for Cities of London and Westminster is grateful for that reassurance.
This brief debate has been about putting on the record what is needed for the future. I therefore do not see the need to press the amendment, but I am glad that we have had the opportunity to clear up a few matters. I beg to ask leave to withdraw the amendment. 
Amendment, by leave, withdrawn.

David Wilshire: I beg to move amendment No. 19, in clause 1, page 2, line 32, leave out 'may' and insert 'must'.
I must admit to being slightly tempted, since you, Mr. Amess, are now in the Chair in place of Mr. Griffiths, to have the same debate that we had in your absence about substituting ''may'' for ''must'', since exactly the same arguments apply, and as you have not heard them you would not tell me that I was repeating them. However, other members of the Committee have heard the arguments and I am sure that they have better things to do than listen to me repeat all that I have said. [Interruption.] I am glad to have some support from the Labour Benches. 
The arguments are the same, and my feelings about why the change should be made are the same. I am not merely being pedantic. When things such as those for which the Bill provides are happening, we might as well make them clear. I shall leave the Minister to decide whether he wants to repeat all the arguments about why I am wrong.

Tony McNulty: At the risk of offending you, Mr. Amess, my response is also the same as previously; it was not terribly interesting the first time round, so I shall spare you the torture of listening to it again.

Christopher Chope: I do not think that that is a satisfactory response from the Minister. We have a lot of detail in clause 1 about liabilities for pensions, for example. I should be grateful if he expanded on what he has in mind in relation to the transfer of pensions. It is not clear to me whether subsection (10) will come into operation before or after the resolution of that issue.
Paragraph 34 of the explanatory notes states: 
 ''Section 244 of the Transport Act 2000 had the effect of converting the British Railways Board's customary practice of providing indexation for cost of living increases for . . . older pension schemes into a binding obligation of the SRA. Consequential provision will be required to reflect the abolition of the SRA. It is likely this will be to transfer this obligation to the Department for Transport to reflect the expected transfer of employer obligations for these schemes to the Department. The intention again will be to ensure that the existing position of beneficiaries . . . is unaffected by amendments made.'' 
However, subsection (8) makes it clear that there is no definite obligation on the Secretary of State to ensure that there is no difference in the terms of transfer; rather, he is granted discretion on the issue.
The provision deals with the issue of the overall liabilities, which may or may not be extinguished, and I would be grateful if the Minister could—contrary to the practice of a lifetime—get down to a bit of the detail. What consequential provision will there be for the indexation of cost-of-living increases for the older pensions scheme? When is the transfer likely to be made? Can he guarantee—this is set out in the explanatory notes, but not reflected in the wording of the Bill—that the scheme's beneficiaries will benefit in exactly the same way as they would at present?

Tony McNulty: Paragraphs (a), (b) and (c) are included in subsection (8) because some SRA employees are potential beneficiaries of the different pension schemes. We must therefore include elements in the Bill to modify provisions for those pension schemes. However, I give an absolute assurance that the position of exiting scheme members will be fully protected. That is one element of the detail that is being worked up as part of the longer-term transfer; as I said, there will not be a big bang.
There is no intention to use the power in subsection (8) to undermine the pension position of transferring SRA staff. The Bill refers to the Transport Act 1980, the Railways Act 1993 and the Transport Act 2000 because beneficiaries of each pension scheme are currently employees of the SRA. I give an assurance that we intend to ensure that the exiting position of scheme members is fully protected. 
Beyond that, all that the amendment would do, as the hon. Member for Spelthorne said, is replace the word ''may'' with the word ''must'' to insist that the Secretary of State should abolish the SRA. In your absence, Mr. Amess, I was accused of saying that the amendment was entirely otiose, which, of course, it is not. However, I did say that it was irrelevant, redundant and superfluous, which it is. If members of the Committee need me to give a full assurance, signed in blood, that the Secretary of State will go further and abolish the SRA, they can have it—metaphorically speaking, as I am not about to prick my thumb for anybody in the Committee. By the time we are in a position to wind up the SRA—all the preconditions having been met, and its functions, assets and liabilities having been transferred—it should be clear that we will do so, whether the Bill says ''may'' or ''must''. 
I apologise for returning to our earlier discussion. I was trying to be brief earlier, rather than discourteous, and to follow the model outlined by the hon. Member for Spelthorne, but I was rudely imposed on by the hon. Member for Christchurch. None the less, I urge the hon. Member for Spelthorne to seek leave to withdraw the amendment.

Greg Knight: I rise at this point, Mr. Amess, because your predecessor in the Chair said that he was not minded to allow a clause stand part debate. The Committee's seating arrangements envisage an argument's proponents being on one side of the Room and its opponents being on the other, and that is, indeed, normally the case. However, we have already placed on record the fact that we do not oppose the  thrust of clause 1, and my colleagues will not divide the Committee when we decide whether the clause should stand part of the Bill.

David Wilshire: I am afraid that I want to say more than merely that I wish to withdraw the amendment. It is sad that the Minister should suggest that my hon. Friend the Member for Christchurch was doing anything rudely. I thought that he was being very polite and that the point he raised was valid, particularly given that there will be no stand part debate. As I understand procedure, it would not have been possible to discuss pension issues, which are very important and relevant. Indeed, I am pleased to say that the Minister's response was not rude. It was actually quite helpful, and it will be an important part of the Committee's proceedings when people want to refer to this valid issue, which my hon. Friend has raised.
I must say that I would not have pursued the matter if the Minister had simply said that he thought it was irrelevant and sat down, but he did not. The trouble is that he carried on with what I consider a ridiculous comment. He said that he was not prepared to prick his finger and produce the blood, but that he was otherwise prepared to write in blood that the Secretary of State ''will'' abolish the SRA. That is exactly what my amendment says. 
Perhaps the Minister will tell me that I am a simple soul who does not understand the niceties of drafting legislation, but the clause states that the Secretary of State ''may'' abolish the SRA where he is satisfied, for any reason, that it is no longer necessary for the authority to continue to exist, whereas the Minister says that the Secretary of State ''will'' abolish it. My amendment seeks simply to make the Bill say that the Secretary of State ''will'' abolish the SRA, yet the Minister says that that is unnecessary. 
I remain totally puzzled by that inconsistency. The use of the word ''may'' is the only thing that is redundant. Why give the Secretary of State discretion when the Minister is prepared to sign in blood that the Secretary of State does not want to use it? None the less, I am content to withdraw the amendment if it will make the Minister happy and if it will enable us to get on to other matters. I beg to ask leave to withdraw the amendment. 
Amendment, by leave, withdrawn. 
Clause 1 ordered to stand part of the Bill.

Schedule 1 - Transfer etc. of functions of the Strategic Rail Authority

Question proposed, That this schedule be the first schedule to the Bill.

John Thurso: I should like briefly to seek clarification from the Minister on two points that relate to the schedule, which has a great deal of meat in it, but to which no amendments have been tabled,  largely, I suspect, because hon. Members had the same difficulty as I had in trying to frame an amendment that asked the right questions.
Part 1 provides for the SRA's strategic and financial functions to pass to the Department for Transport. The broad thrust of the issue is dealt with in the schedule. The first of my questions relates to strategic functions. One of the SRA's strategic functions was to formulate a strategy, write it down and present it to the Secretary of State. Clearly the Secretary of State cannot present a strategy to himself, so how will a strategy be written down and will it be presented to Parliament? Now that the Secretary of State has taken that duty, he is no longer the check and balance on the SRA, and the report that was previously made to him, and made public, now need not be made. I hope, however, that it will be made by the Secretary of State and laid before Parliament. 
My second question relates to financial functions and how the Secretary of State will deal with funding for the devolved Administrations, particularly in Scotland, but also in Wales. How will he ensure equity in funding so that the funds that are available, particularly for railway improvements, will be equitably shared between all the devolved nations?

David Clelland: I seek clarification and assurance from the Minister about the schedule, which abolishes some of the SRA's functions. When a passenger boards a train at a station and travels to another station, they are not simply travelling from one point to another, unless they happen to be fortunate enough, or unfortunate enough, to live next to the station and are travelling to a destination that is also next to a station. They may rely on other forms of transport.
According to section 205 of the Transport Act 2000, one of the purposes of the SRA was 
''to contribute to the development of an integrated system of transport of passengers and goods.'' 
The schedule before us abolishes that and replaces it with a duty on the Secretary of State to promote improvements in railway service performance and otherwise to protect the interests of users of railway services. There is no reference to any obligation on the part of the Secretary of State to involve himself in the development of an integrated transport system. Can the Minister assure us that that is not a deliberate deletion, and that the Secretary of State will still consider integration issues? If that is the case, can he also assure us that, either in Committee or on Report, the Government will table an amendment to reintroduce an integrated transport system?

Christopher Chope: As the hon. Member for Caithness, Sutherland and Easter Ross said, this is a meaty schedule. We know that one of the rationales for the Government's abolishing the SRA is to save money. That will result in a reduction in the number of people  employed. In the context of this schedule, can the Minister spell out the detail of how many of the 454 people currently employed by the SRA will have their jobs transferred—in other words, their functions will be replicated under this schedule—and how many will lose their jobs because the functions that they perform will be taken away? That should be an easy assessment for the Minister to carry out; at its heart is the saving that will result from the whole process.
Although we are told that a lot of functions will be abolished, the list of abolitions in the schedule is pretty short. Can I ask the Minister about two of the abolitions that are specified in paragraphs 34 and 36? Paragraph 34 is about the abolition of functions relating to penalty fares. How many people are currently involved in that function, and how often it has been exercised up until now? What impact will its abolition have? Similarly, how many people exercise the powers that are to be abolished under paragraph 36—those under the 2000 Act to provide railway services and substitute bus and taxi services, and to make byelaws? What will be the impact their abolition? Will the railways be able to survive without their being performed? Most of all, I hope that the Minister will be able to tell us how many of the 454 people will have their functions abolished rather than replicated under the schedule.

Simon Thomas: As this is the first time that I have had an opportunity to speak in this Committee, may I say how pleased I am to be here and to work under you, Mr. Amess? I look forward to our debates, as the Bill has a lot in it for Wales, as well as for the United Kingdom as a whole, and a great deal on devolution, as we discovered under clause 1.
I should like to make some brief comments along the lines of those of the hon. Member for Caithness, Sutherland and Easter Ross and the hon. Member for Tyne Bridge (Mr. Clelland). Of particular relevance is the SRA's duty to promote the railways as an integrated whole, which many of us welcomed when the SRA was set up. I am sure that clause 3 will give us an opportunity to discuss amendments along those lines, but, as this schedule abolishes that duty, it is relevant to ask the Minister now how he foresees himself undertaking the general promotion of the integration of freight and passenger railway services. That is not easily transferred either to himself, to the National Assembly or to the Scottish Parliament. There is a gap there. While I strongly support devolution, I should not like there to be a lack of integration throughout the UK as a whole, which is essential for the smooth running of services and the promotion of an environmentally sound railway. The promotion of freight comes into that context. This is an opportunity for the Minister to explain that in more detail. I look forward to hearing what he has to say. 
The second aspect relates to finance. We are abolishing functions and transferring liabilities as well  as the opportunity to spend. It has already been mentioned that this is a possible way of saving money. I am not so concerned about the 400 or so jobs that might be affected. I am concerned about the individual cases, of course, but that is not where the big money is. The big money is in the transfer of functions to the Scottish Executive and the National Assembly. There is an opportunity to ask those national Governments to try to spend on the railways to make up for a possible shortfall from the central Government purse. 
As liabilities and spending are transferred it would be useful to have an indication of the sort of negotiations that are going on now about the spending and funding arrangements that will be in place. The hon. Member for Caithness, Sutherland and Easter Ross spoke of equity, but we also want to ensure that if Scotland spends a little more on the railways because there is a particular social, environmental or economic need, it can do so without it having a knock on effect on spending in forthcoming years. The same would be true in Wales. 
If one of the new bodies that is now undertaking the work of the SRA is prepared to invest a little more as a one-off, how can we prevent that from becoming embedded in the relationship and leading to knock-on effects further down the line? We have to be careful that we do not all jump for joy and see the wonders of transferring functions to Scotland and Wales, but overlook the dangers of not having a carefully worked out relationship and funding formula between the constituent parts of the United Kingdom. We have to ensure that there is equity there and equity for many parts of England too. We are all aware of where the funding is going at the moment in the national rail service and what parts of England are being excused from that. 
Two key questions lie at the heart of my reading of the schedule. One relates to the overall promotion of the railways, ensuring integration and ensuring that the railways are used in Wales, Scotland and by the Secretary of State as an environmentally safe alternative and a physically safe alternative to road transport for passengers and freight. The second is how we ensure that the promotion does not have spending consequences that could be deleterious to the National Assembly or to the Scottish Parliament. Equity, safety, environmental responsibility and the promotion of an integrated railway are the key concerns. We need to ensure that that still happens, even though we have transferred functions and accountability to different bodies. I am sure that it can be done, but I do not think that we can read a schedule and a clause to find out how it will be done. It is for the Minister to explain and to put the meat on the bones so that we have a sense of the Government's purpose in trying to achieve this end.

Tony McNulty: As I said earlier, there are some 14 pages to schedule 1. Hon. Members are entirely right: that is where the substance lies, rather than in the clauses. It is therefore appropriate to discuss it. I shall try to pick up on some of the issues that hon. Members have raised. First, there is a tad of confusion over the SRA and the notion of integrated transport. When it  was set up the SRA, as its name implies, was charged with a whole range of functions and duties around railways: nothing else, just railways. It was important in that context to put on the face of the Bill that created the SRA the additional function of integrating the railways into all other forms of public transport. That was quite proper.
With the demise of the SRA, given that most of those functions are coming back to the Department for Transport, do we need to maintain that duty? We would argue strongly that we do not. At best, it is a tautology to say that there needs to be a statutory duty in respect of integrated transport on the Department for Transport, with its myriad strategies that, rather like in an episode of ''Yes, Minister'', aspire to an integrated transport system. We say that such a duty is not needed, because it is already there in the substance—in all that we do across the piece. 
One of the White Papers issued in July, ''The Future of Transport'', said clearly that we are wedded to an integrated approach. Indeed, it goes beyond that and says that in the course of devolution, of getting some decision-making processes down to a lower level, matters should be addressed far more firmly in an integrated context. We have said that in the context of passenger transport executives and the role of local councils with local transport plans. We have tried to make it as explicit as we can that, with regard to the future of local transport plans and much of what PTEs do, integration should be uppermost in people's minds and in strategies, whether they relate to bus, light rail, rail or whatever. I am talking about what local authorities and PTEs are doing on urban congestion, bus prioritisation and all the other elements. 
The duty was very important when creating an organisation specifically to deal with rail. To say that it should have wider regard to integrated transport was appropriate. However, just because we have got rid of that body, it is not necessary to say to a range of other bodies—PTEs, local authorities, the devolved Administrations and the Government—that they should have due regard to an integrated approach, because that is already the aspiration and it is already happening across the piece in legislation, strategies and policies. We do not need anything in the Bill or in other legislation for that to be the case. All those strategies, including our own, will be in the public domain, whether at the level of route utilisation strategies, the overall approach that follows on from the rail White Paper or whatever else. 
The second point made by the hon. Member for Caithness, Sutherland and Easter Ross on equity and the devolved Administrations is fair, and the hon. Member for Ceredigion (Mr. Thomas) is right. Devolving power or responsibility without equitable resources is not terribly clever or useful with regard to public policy for the central Administration or the devolved Administration. All I can say at the moment is that detailed discussions are ongoing with the Administrations in Scotland and Wales. I can assure  the Committee that our goal in the negotiations is equity, but as they are ongoing I cannot at this stage report their outcome.

John Thurso: Will the Minister elaborate on that point? I do not doubt that he is seeking equity and I am sure that Scottish Ministers will also want to come to a good resolution, but he has spoken about a negotiation taking place. Will that negotiation produce a result for this year, and then there will be another negotiation next year and another the year after? Or are the Government and the devolved Administrations seeking to negotiate a formula that at least puts in place broad parameters to allow people on all sides to know what may or may not be available? I should be particularly grateful if the Minister addressed his remarks not so much to maintenance of the network—that is fairly straightforward and can be easily done by Network Rail—as to enhancements, which may or may not take place in a particular year. In other words, are the Government and the devolved Administrations seeking a formula, or will there be an annual negotiation process?

Tony McNulty: At the risk of sounding like a Liberal Democrat, I suggest that there will probably be a bit of both. Detailed negotiations will be needed on the first transfer of resources, but we hope—I think that both sides agree—that there will be a degree of a formulaic approach thereafter. I take the point about maintenance versus enhancement. That must be part of discussions with us, Network Rail and others, and the relationship between enhancements and maintenance will be an issue in terms of cross-national railway lines and more locally controlled lines. Those remain matters for discussion. I am not being facetious; the answer is a bit of both. We are trying to resolve the issue around a package in the first instance, and a formula thereafter. It is not necessary on either side for there to be some sort of annual bidding war and arm-wrestling contest.

Simon Thomas: I accept what the Minister says. It makes perfect sense in the context of getting the process moving, but for the future, will the formula be the Barnett formula or some other formula that relates specifically to the cost and use of railways in different parts of the UK?

Tony McNulty: As I said, the negotiations are ongoing, and ongoing means ongoing. I am sure that those involved are having as much fun as we are discussing an array of options and particular futures in relation to that settlement, and that is entirely appropriate. If at any stage I can report anything to the Committee by letter or in person about the negotiations regarding Scotland or Wales, I shall be more than happy to do so.
I am conscious of the time, and it would be nice to dispatch schedule 1 by the end of the sitting. 
Mr. Knight rose—

Tony McNulty: I must also admit to an error, but I shall first give way.

Greg Knight: We wait with bated breath to hear the Minister admit to his error.
I ask the Minister to move from equity to transparency, and I refer him to paragraph 15 of schedule 1, on pages 62 and 63, which discusses statements of policy made either by the Secretary of State or by Scottish Ministers. Sub-paragraph (6) envisages a scenario in which a statement of policy is not published, and says that that will not 
''affect the validity of any selection made.'' 
Will the Minister give a commitment that the Labour Government will make statements of policy, and that Labour Ministers of the Scottish Parliament will also make such statements?

Tony McNulty: Again, it is not for me to speak for others, but there are already numerous statements of policy about the future of rail, not least including the White Papers issued in July. Our future strategy and all the consequences of the review will be published and in the public domain. This is the most substantial devolution of power since the Scotland Act 1998 in terms of Scottish rail, and I cannot foresee a circumstance in which there will not be a statement of policy from the Scottish Executive, although it is not for me to speak on their behalf.
I am conscious that we will probably have to return to the fun that is schedule 1, so the right hon. Gentleman will have to wait to hear about the error, as I shall first deal with a few points that were appropriately raised. On the point made by the hon. Member for Christchurch, I appreciate that the paper that I promised on Second Reading was made available only this morning, so hon. Members probably have not had the chance to read it. Under the heading, ''Implementing the White Paper; changing the structures'', it starts to put some flesh on the bones of what the Department's rail unit will look like post SRA. 
The paper says that we anticipate some 250 to 280 people being involved in the new rail group in the DFT. Currently, there are not only 430 people at the SRA looking after rail, but 100 people in the Department who do so. Those 530-odd people will be reduced to 250 or 280 in terms of the Department; perhaps 50 others from elsewhere in the SRA will go to the RPC and certainly to the ORR, while a few will go to Network Rail. That reduction of up to 200 does not mean that there will be 200 redundancies; other options will be explored, and there are ongoing discussions with those individuals and the unions now that the high-level element is in place. 
Some of the SRA functions that are being abolished are functions that it currently shares, such as penalty fares. I cannot tell the hon. Gentleman, hand on heart, how many SRA staff are involved in penalty fares at this very moment. It is a shared function and some of it will come back to the Department. The same applies to the functions to be abolished under paragraph 36.
We will consider boosting the local dimensions of some of those functions, affording greater local control over some of the penalty fare structures. In some areas, including Tyne and Wear, it takes a parliamentary order to change penalty fares. I do not understand why that happens; that is why we are examining it. It might not please my hon. Friend the Member for Tyne Bridge, because a number of people just carry £10 in their top pockets when travelling on the Tyne and Wear metro, on the off-chance that they will be caught every now and then. They pay it over, and their free travel is covered for the rest of the time. There are some concerns in the area that that needs to change. Tyne and Wear needs a parliamentary slot of some sort to enable that change. We are considering that, too. 
Much of what the Bill does, as will become apparent as we trundle through it, is enabling. Any number of matters of substance and detail follow from it, rather than being contained in it. The Committee should take that on board.

Greg Knight: On the Minister's point about Tyne and Wear, the long title of the Bill is extremely wide. Why does he not introduce a measure in this legislation?

Tony McNulty: That is an interesting point, but it is the reverse of what I was saying about the need for the SRA, as a railway-specific body, to have integrated functions under the Bill. The powers that we want to give to local authorities or enhance for them invariably involve penalty fares across public transport, so it would not necessarily be appropriate to introduce them in the Bill. We think that we can do that in other ways, and we shall explore those.
I am tempted to try to explain the error that I have mentioned in three minutes and dispatch the schedule, although I am not sure whether that is possible. In paragraph 20(5), we refer to a service provided or secured immediately before the commencement of the paragraph by the Secretary of State. Of course, that is nonsense; it should say ''by the SRA'', because it refers to the winding up of services that are currently carried out by the SRA. We do not have to look at the provision in detail now; it is a drafting error and I shall introduce an amendment to correct it. I shall also have a note drafted so that everybody is clear what the error was: it should say SRA rather than Secretary of State. 
It has been important for us to spend some time on the schedule, because it contains the meat or at least the framework of the post-SRA world; that is why it takes up 14 pages. I am sure that everybody has read it, but it is worth reflecting on it for a while, because the characterisation that we are getting rid of the SRA and that all its functions are coming back to the Government is not appropriate. There are elements relating to the change of previous relationships between the Office of Rail Regulation and the Department that involve some SRA staff, and elements to do with Network Rail that include some of the functions currently performed by the SRA. It is worth reading the schedule to see the route map for the future of rail post-SRA.

Christopher Chope: Will the Minister give way?

Tony McNulty: I will not.
I commend the schedule to the Committee.

Christopher Chope: I am disappointed that the Minister did not give way. The whole point of debate in Committee is to have some flexibility. He referred to a document that he laid on the Table this morning, but he has not told us whether it responds to the concerns that I  expressed. I made some perfectly reasonable points, and I should have thought that it was possible for the Minister to say, in respect of each of the paragraphs in the Schedule—
It being twenty-five minutes past Eleven o'clock, The Chairman adjourned the Committee without Question put, pursuant to the Standing Order. 
Adjourned till this day at half-past Two o'clock.